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Guide To Purchase A House In Singapore

Well, when it's time for you
to step into adulthood, to start planning for your future and to start a family
of your own soon. You start looking for houses in Singapore. However, you are
swarmed with the negative comments by people around you telling you various horror
stories that you can ever imagine, e.g.: the debts that you got yourself into
after getting your first property in Singapore and the tedious process of
getting a property in Singapore. The horror of getting into a debt with the
bank for at least 2 decades of your life frightens you. You worry about not
having enough money for yourself after paying for mortgage loan for your first
property in Singapore. If that is the case, you can consider loan refinancing
and review your housing loan options carefully. This article will guide you
through the process of purchasing a house in Singapore.

Guide To Purchase A House In Singapore

1. The help of CPF

The first thought
that comes to you when a suggestion of getting your first property in Singapore
is the huge debt that you get yourself into. This seems normal to most people
as it is a huge sum to deal with after all. However, do remember that you are allowed
to use your CPF to make monthly payment for your property in Singapore and this
might help lessen your burden. In addition, most down payment for your property
in Singapore will be covered when you use your CPF to make payment.

Not willing to have
your CPF deducted to make monthly payment for your property in Singapore? Fret
not, you can opt for HDB loan if you are purchasing an HDB flat. The HDB loan
allows it to cover up to 90% of the HDB flat price. The remaining 10% will then
come from your CPF. 10% of the remaining HDB flat price coming from your CPF
definitely sounds much better than having to pay monthly for your HDB by using
your CPF.

2. Choose a house
and go for the launch

Location plays an
important role as well. You certainly do not want to spend 2 hours daily on
commuting to work. Same goes to your children’s school. Therefore, you should
choose a condominium or apply for a BTO that is near to your workplace so you
can save on transportation fares and also you will have that extra 15 minutes
before you prepare for work.

Normally, HDB will
post any upcoming launch on the HDB website. Do check from time to time so you
do not miss out on anything. You will be able to check out the details such as
the location available and types of flat. Other than the location and types of
unit, the rest will have to wait until the next launch.

In addition, checking
out on all these details will allow you to shortlist the type of unit and
location that you are interested in applying as application is only opened for
a week. You do not want to make any rush decision on such important thing.

3. Sales launch –
HDB loan & down payment

If you meet the
criteria of applying for a BTO flat, you can now move on to applying a HDB home
loan. In order to be eligible for securing a HDB home loan, these are the few
criteria you need to meet. First of all, you are planning to apply for a HDB
flat. Secondly, you must be a citizen of Singapore and aged 21 years and above.
Your total monthly income should also be lesser than $12,000 or $18,000 if you
are applying for a HDB flat for extended families.

In addition, you must not
own or previously owned any properties that are private in the past 30 months
prior to the application of HDB loan. You must not have more than a hawker or
market stall or an industrial property or commercial property, unless you are
working in the market or hawker stall yourself.The total loan amount that will be approved depends on your joint income
when your flat is ready.

As a rule of thumb,
buy within your means and only what you can afford as you do not want to fall
into financial debt. For example, you should not buy a flat that costs more
than $300,000 if your monthly income is $5,000. It is suggested that you do not
buy a flat with a price that cost more that your gross combined salary of 5
years, although most people would say that their salaries would have increased
by then, there is still a risk involved.

4. Schemes
available

As for the
Additional Housing Grant (AHG), it is a scheme that aims to help Singaporeans
with lower income to purchase their first flat with grant ranging from $5,000
to $40,000, subject to buyer’s income as well. To qualify for an AHG grant,
your household income should not exceed $5,000 per month, for a period of 12
months before your application for the flat.

There are also
other schemes available such as the Special Housing Grant (SHG) that you can
check out on HDB website.

5. Wait patiently
for your house to be ready

Once your house is
ready, you will then need to start spending money on renovations. You used to
think spending $100 on a beautiful ceiling fan is stupid and the worst decision
ever. But guess what? You start thinking that it is necessary. The aesthetic
value makes you think the ceiling fan is worth it.

You realize that all the
furniture matters and it is necessary to splurge on all those things that you
once thought were stupid and a waste of money. Therefore, to prevent yourself
getting caught in the middle of wanting more but not having sufficient money
for them, start saving in advance and plan your budget wisely. That will
definitely save yourself a lot of time and renovation loan with high interest.

In a nutshell,
buying a property in Singapore is not so of a nightmare if you plan ahead and
do you budget wisely. Moreover, getting a property in Singapore is definitely
going to worth your money, time and effort in the future. However, do your
research first before getting buying a property in Singapore. If you are
planning to get a BTO, you can read the step by step guide to buying your first
BTO flat.